Research shows: Optimists live in a better world

Most people think that either optimists or pessimists got it wrong, they see the world through their rose or grey tinted glasses and whatever they experience, they interpret as positive (optimist) or negative (pessimist). At the Sunbelt Conference of the International Network of Social Network Analysis last week, I heard a talk by John T. Scholz who showed that maybe both are giving a realistic account of what their experience looks like, that the optimist might indeed live in a better world than the pessimist.

He described an experiment he called voluntary dilemma (as opposed to the prisoner’s dilemma, where participants cannot opt out): 20 students played for 20 rounds, in each round they would choose one partner to cooperate with and could either fulfill their commitment or cheat. Delivering was a bit more expensive than cheating. If both parties delivered, they won a great price (of game money), if you cheat and the other one delivers, you win a medium price and if both cheat, you still have some small reward.

What happens is this: Optimists and pessimists approach the game with different attitudes: If you assume everyone will cheat, it is only rational to cheat, cutting your losses and still getting a small benefit. If you assume everyone will be honest, you will deliver and every time you play with another optimist, you both will take home the big reward. But what about the times when you play with a cheater? Scholz found out that by far the most rewarding strategy was to play Quit for Tat: You offer everyone a first chance, if they deliver, you continue playing with them but the first time someone cheats, you quit; you are unforgiving and don’t give them another chance.

Because of this strategy, the groups quickly segregated into an optimist and a pessimist cluster: The honest players identified each other, kicked any cheaters out at their first try and developed strong relationships of repeated play with high rewards. So, after a few rounds of playing the game, they actually lived in a gated better world, where those who cheated were not allowed in. Most of the pessimists did try out a different strategy sometime in the middle of the game. But at that time they only had the other pessimist left as possible playing partners and whenever they tried to play an honest game, they were disappointed and got reaffirmed in their experience that honesty doesn’t pay. If you started off by cheating, it was basically impossible (in this small 20 player game), to move out of your group, into the optimist group. In all games the unforgiving optimists took home much larger prices than anyone else. This effect was significantly increased when the researchers allowed partners in each round to recommend other players to each other.

This was an eye opener for me: I don’t think the world as a whole is a particularly good place and I know that people do evil and selfish things all around me. But I always had that feeling that I live on this lucky island, where people are just a bit nicer to each other than average. When Scholz described the unforgiving optimist, I felt like looking in the mirror, because I do give everyone the benefit of the doubt – once.  If they don’t fit on my little island of optimists, they won’t get permanent resident status…

5 Responses

  1. Great post about a more “common” version of the Prisoner’s dilemma and optimal tactics.

    I love how clear it makes competitive advantage of “smart optimism”. I would suggest that an alternative to the Tit-for-Tat (penalize cheaters by exclusion) would be to be to create a learning alternative for the “cheater”; clear communication about what did not work and limited opportunity to re-gain trust.

    Was such as scenario discussed at the event?


    • Hi Michael,
      The presentation I listened to was rather focussing on the quantitative results of a lab experiment – the real live thoughts about it are more my own. I agree with you that this kind of game is great for those who got it right the first time round but also means that the mistakes of your past are going to haunt you. Which I think is a realistic picture especially in small communities/groups. The approach of the researcher was rather to find out what happens, what kind of logic is working here and what kind of approach pays how much to the individual. He was not looking at it from an intervention standpoint but really just describing what people tend to do.

  2. What are the ways to ensure an objective decision within a group?…

    I think the first step is to say goodbye to the notion of “objectivity” that seems to assume that there is a neutral judge somewhere, who could define what the best objective answer is. Once all group members accept that this is more about balancing …

  3. Are optimists more likely to be successful than pessimists?…

    I have found some interesting research in social network analysis which showed that optimists actually live in a better world than pessimists. This is based on a game theoretical experiment (but also resonates with everyday experience) where participan…

  4. Is being too nice detrimental to being successful?…

    It seems like the most successful approach is to be an unforgiving optimist: Play with everyone once, assuming optimistically that they will honor your trust. If they don’t, be unforgiving and don’t play with them again. At least that’s what I learn…

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